The Online Powerhouses Get Comfortable Orbiting Madison Ave.

Next week, when 60,000 people in marketing and communications are expected to descend on New York for Advertising Week, some of the world’s largest tech companies will be taking center stage.

Once dismissed as ancillary players at the eight-year-old gathering, online heavyweights like Google, Yahoo and Facebook will play a more prominent role, with panel discussions on mobile connectivity, online privacy and social networking all grabbing top billing among the tangle of 200 events.

But amid the clamor of seminars and after-hours parties, some of those same companies will also be hosting prominent events on their home turf, made possible by a recent flurry of office expansions.

“This will really be our first industry opportunity to truly showcase all our space,” said Wayne Powers, senior vice president for advertising sales at Yahoo, which has just opened offices in the Viacom building in Times Square. “It’s always been a great event to connect with our clients and all the agencies, but this will be the first time where we’ll be able to use our offices to do client entertainment and to set up meetings. For us, that’s a big deal.”

While Silicon Valley’s most formidable Internet behemoths have leased office space in New York since the 1990s, their rapidly shifting partnership with Madison Avenue has driven the move from back-office cubicles to elaborately designed corporate suites intended to impress advertisers.

While Palo Alto, Calif., remains a hub for computer engineers, New York has surged as a location for the virtual world’s unsung marketing and sales divisions, with Facebook, Google, Yahoo and Apple all expanding in the city since 2010.

Andrew Roos, a vice chairman at Colliers International who has brokered leases for a number of digital media start-ups across New York, said one thing that those large Internet giants have in common with smaller companies is an overwhelming need for advertising dollars.

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Facebook workers at 335 Madison Avenue can participate in fitness sessions and use RipStik boards to move about the office.Credit
Marilynn K. Yee/The New York Times

“The goal for all these companies will always be one of two things: either to become very profitable or to go public and monetize,” he said. “Most will lose money, of course. But no matter the goal, to even dream of being profitable, the currency they trade in will always be advertising. To be a contender, they need to be here.”

Before partly relocating last month to a 50,000-square-foot three-story suite at 1540 Broadway, at West 45th Street, Yahoo’s marketing, sales and account management divisions in Manhattan operated from 111 West 40th Street, a space that, while larger, did not lend itself to receiving or wooing clients. Yahoo will keep that space.

The Times Square suite has purple-hued conference rooms, a lobby with custom graphics and door pulls shaped like exclamation points, and a dynamic design that befits a high-tech company.

“This gives us the ability to be forward-facing with our clients,” Mr. Powers said. “Now we’re able to bring the experience we created on the West Coast to the New York area. That’s versus having to literally take a day or two of getting our clients to the West Coast, which is what we had to do until last month.”

When Facebook signed its deal for 335 Madison Avenue in late June, officials at the social network not only relocated from offices across the street, but doubled in size and moved forward with a redesign that incorporated the upstart flair of the headquarters in California.

The company’s new office evokes a kind of romanticized view of a Silicon Valley start-up, including an open bar, video games and threadbare couches that reflect the dorm-room sensibilities of the roughly 100 employees who work there.

“When you get to that critical point in terms of the number of employees,” said Carolyn Everson, the vice president for global direct sales, “we like to have a look and feel similar to how Facebook looks and feels in Palo Alto and Singapore and London. And with this market — where we’re all on Madison Avenue and entertaining and meeting with clients every day — we wanted to have a proper presence. And we just weren’t able to do that in the limited space that we had across the street.”

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Yahoo's new sales and marketing offices in the Viacom building at 1540 Broadway overlooking Times Square.Credit
Marilynn K. Yee/The New York Times

Apple Inc. recently expanded iAd, its mobile advertising division, in the Flatiron district. The company had been operating on a month-to-month basis at 100-104 Fifth Avenue since January and last month signed a deal to increase its space to 45,000 square feet from 10,000, in a building also occupied by online companies like Yelp and Net-a-Porter.

In December, Google solidified its presence in Manhattan by buying the building at 111 Eighth Avenue, where it had leased space since 2006 for many of its marketing and sales employees.

At $1.8 billion, the acquisition of the building — at 2.9 million square feet among the biggest in New York — was the city’s largest office transaction of 2010.

With a helicopter landing pad atop its Art Deco roof, the 1932 building occupies an entire block in Chelsea, bounded by 15th and 16th Streets, and can accommodate Google’s Manhattan work force of 2,500 employees with relative ease.

Google’s marketing and sales offices take up most of the company’s space inside the building, but leases are coming due for a number of holdover tenants. That means that Google might soon have even more space.

But as the relationship between the virtual and advertising worlds gets closer every day, Google may need that extra space sooner rather than later.

Torrence Boone, the managing director for agency business development at Google, said the company’s growth from a mere search engine to a multifaceted communications and media conglomerate has made advertising dollars critical.

“Our connection to the ad agencies is increasingly important because our product has expanded so dramatically over the past couple of years,” Mr. Boone said. “We aren’t just a search engine anymore. We’re now in the world of ideas and branding, and that’s a world that’s shepherded by the advertising agencies, so it’s more important than ever to connect with them intimately, and so that’s really why we’re here.”

A version of this article appears in print on September 28, 2011, on page B6 of the New York edition with the headline: The Online Powerhouses Get Comfortable Orbiting Madison Ave. Order Reprints|Today's Paper|Subscribe